Hottest Neighborhoods 2013: Places Expected to Lead the Pack This Year

It seems that the housing market is slowly but surely rebounding in America. Existing home sales and asking prices have crept up, and analysts report decreasing delinquencies and foreclosure filings. As a result, some of the most sought-after neighborhoods in the U.S. are beginning to see high listing prices and a shrinking inventory.

"The results surprised us," said Redfin CEO Glenn Kelman. "The hottest neighborhoods aren't the well-known bastions of privilege. They're once-gritty urban areas and far-flung suburbs with school districts on the rise."

Overwhelmingly, California neighborhoods dominated the list, a trend Kelman chalks up to the state's improving economy and the lure of a thriving tech scene.

"Across the state, there are far more buyers than sellers, and we see bidding wars on almost every reasonably priced listing in Silicon Valley and Orange County," he told BI. "It's probably also true that what happens to America happens first in California: The real estate bubble burst in California first, so buyers there have been waiting longer to make their move than just about anywhere else."

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Hottest Neighborhoods 2013: Places Expected to Lead the Pack This Year

"The Mission used to be thought of as a rough area, but it's started to emerge as a highly desirable area over the past year," says local agent Landon Nash.

"There's great diversity, tons of cultural activities and great restaurants and shopping. People are getting priced out of Noe Valley and the Castro, so the Mission is right there and a great alternative."

Los Angeles-based real estate agent Earnest Watts knew where to go when he was house hunting in September.

"Because of its relative affordability, accessibility, and proximity to several of the area’s most popular neighborhoods, I bought a home in Glassell Park back in September," he says. "I have a few local bars, restaurants and bakeries, but the neighborhood is right in the middle of four bustling neighborhoods: Highland Park, Atwater Village, Echo Park and Silver Lake."

"One of the major changes that this particular area is going through is the Metro line being installed by the city; it would be the first time West L.A. is connected to downtown by mass transit," says local real estate agent Kameron Eliassian.

"This will help out people's commute tremendously. In addition, the school systems have improved in this area, making it attractive to families."

Methodology: This ranking was based on data from December 2011-2012 for housing markets in Atlanta, Austin, Boston, Chicago, Dallas, Denver, Los Angeles, Philadelphia, Phoenix, Portland, Sacramento, San Francisco, Seattle, Silicon Valley, Southern California, and Washington DC-Baltimore. Redfin highlighted the top three neighborhoods in each metro area, then whittled the list down from 48 to round out its top 10. See the full ranking here.